I want to set up my Linksys E4200 router behind my AT&T U-verse Residential Gateway (2-Wire). Essentially disabling the WiFi on the Residential Gateway and making the E4200 handle all routing and WiFi for my network.

What steps do I take for both the Residential Gateway (2-Wire) and the Linksys E4200 router to accomplish this?

Setting those options as specified makes the 2Wire as transparent as possible, such that it minimally interferes with your traffic. I specified these settings because the goal is to make the 2Wire as much of a transparent bridge as it can be.

Yes, you need to make your router's LAN subnet different from the RG's subnet. The RG's default subnet is 192.168.1.x, so if you leave the RG's set like that, you need to make your router's LAN subnet something different, like 192.168.2.x.

If you're having problems with your service, you should call technical support, have them send a premises tech to your house to check the line. He may need to open a helper ticket with the Installation and Maintenance group (I&M), which are the linesmen, to perform additional troubleshooting.